Key Points
Anterix received a positive analyst note and upgrade today.
Anterix's 900 MHz wireless assets could become a coveted asset.
Whether Anterix will sell the asset or not is a speculation. While the value of its spectrum is likely higher than the current market cap, management is currently focused on building services around the spectrum instead.
Shares of Anterix (NASDAQ:ATEX) rallied on Thursday, up 8.0% on the day.
Anterix received a positive sell-side analyst note today, two days after its September-quarter earnings report.
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Anterix doesn't currently have much of an operating business, but it does hold valuable low-band spectrum. With increased competition to control wireless spectrum these days, the analyst thinks Anterix will benefit from higher prices for these scarce assets.
B. Riley ups its target
Today, telecom analysts at B. Riley upgraded their price target on Anterix from $86 to $103. Following Tuesday's earnings release and conference call, the analysts now appear more bullish on potential pricing for any deal involving Anterix's spectrum assets. The analysts note that there is "very real competition for scarce spectrum resources coveted by global satellite operators" and highlighted the recent purchase of 800 MHz spectrum by Space Exploration Technologies (NASDAQ:SPCX) from Grain Management as evidence.
Anterix is currently focused on leasing its 900 MHz spectrum and building services around it, rather than an outright sale. However, management may sell spectrum to a bidder outright if the price is high enough. CEO Scott Lang said on the recent conference call with analysts that "the number of available nationwide low-band assets is down to one, and it is Anterix."
Image source: Getty Images.
A speculative buy
After today's gain, Anterix has roughly a $1.5 billion market cap, even though it has only just over $7 million in revenue over the past 12 months. So, the company's entire value appears to be entirely in its 900 MHz spectrum assets.
It appears, at least to B. Riley analysts, that the price of that asset is significantly higher than the market is currently pricing in. Therefore, Anterix may be of interest to some investors looking for idiosyncratic bets. Just be aware that the timing of any purchase is highly speculative, and spectrum asset prices can fluctuate.
Billy Duberstein and/or his clients have no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Space Exploration Technologies. The Motley Fool has a disclosure policy.